"How important is it to have identified targets when pitching a roll-up platform?"
A sponsor recently asked me this question.
It depends.
Show, in order of importance:
• Experience with executing acquisitions. (= Ability to execute)
• That the space is fragmented. (= High volume of targets)
• There is real value in acquiring and integration (cost efficiency, economies of scale, cross-selling, etc.). (= Value add)
• The competitive positioning. (= You'll be an acquirer of choice)
Beyond this, I'd rather hear about 1-2 active conversations than 10-20 random companies in the space.
